In 2019, almost half (45.4%) of global green bond issuance was denominated in euros and more than half was concentrated in the EU, according to the 19th annual review of the international role of the euro, published by the European Central Bank (ECB) on Tuesday 9 June.
The document states that “EU residents are the largest issuers of green bonds”.
In addition to being the main currency for the issuance of green bonds, the euro is also the leading currency in terms of relative importance of green bonds compared to other bonds. The proportion of green bonds relative to total bond issuance denominated in euros rose to almost 9% by the end of 2019, compared to 2.1% for bonds in US dollars and around 2.5% for bonds in other currencies.
In addition, non-euro area residents accounted for almost 30% of total euro-denominated green bond issuance in 2019, which “suggests that the euro is also attractive for foreign issuers”.
The ECB added: “The consolidation of the EU role as a global hub for green finance could strengthen the euro as the currency of choice for sustainable financial products, bolstering its international role”. The ECB concludes by saying that this will, however, depend on a number of factors, particularly the swift implementation of the European taxonomy.
To read the ECB report, go to: https://bit.ly/3cWyvRD (Original version in French by Damien Genicot)